Formula One governance structures suspended

The Strategy Group, The F1 Commission, The manufacturers working group, The World Motorsport Council… There are so many different groups of people that apparently make decisions if F1, it’s a wonder that anything ever gets accomplished. Well more often than not it doesn’t. Tonight the World Motorsport Council (WMSC) announced there will a number of changes in various FIA racing series. You can see all of them here, but we for now focus on a significant dictat made regarding Formula One.

“The World Motor Sport Council approved, by a near unanimous number (just one vote against), a mandate for the FIA President, Jean Todt and the Representative of the Commercial Rights Holder, Bernie Ecclestone to make recommendations and decisions regarding a number of pressing issues in Formula One such as governance, Power Units and cost reduction. Mr Todt and Mr Ecclestone expressed their intention to establish conclusions on these matters by 31 January, 2016”.

So what does this mean? There are a number of possible interpretations, however, given the bust up at the last F1 commission and the agenda issued by the FIA following that meeting it is most likely that Jean and Bernie now have a mandate to bypass the F1 Strategy Group and the F1 commission on matters pertaining to the budget F1 engines and cost reduction. The inclusion of the broad term “governance” as part of the mandate would appear to add credence to this interpretation and that the F1 Strategy Group and the F1 Commission have been removed from the sport’s governance loop for the time being.

This mandate may well be just a temporary suspension of Formula One’s normative governance bodies, given cited date of January 31st 2016.

In reality, it is unlikely Todt will use this power in an attempt to overturn the Maranello veto and force Mercedes and Ferrari to cut the price of their power units, because that power given to Ferrari is legally binding, even for the WMSC. Setting the Ferrari veto to one side, the FIA would have a legal battle on its hands anyway if it tried to force the F1 power unit manufacturers to reduce their prices given that the FIA regulations for the new V6 Turbo hybrids were agreed on by all parties – and no such clause was included.

Whilst Jean Todt has accepted the FIA made a mistake in not writing in a cost cap into the new V6 Turbo Hybrid regulations, an omission from one party is no grounds for a unilateral change in the terms of contracts.

Where Todt does have power, is over the 2017 regulations. He and Bernie could force through regulations that deliver a ‘budget’ F1 engine. They could also make drastic changes which would restrict the aerodynamic development of the cars in a way which is unpalatable for the bigger teams and the PU manufacturers.

Whilst a near total freeze on in season car development in 2017 wouldn’t drastically reduce the cost to the smaller teams, it would hurt the more wealthy outfits and restrict their advantage, levelling the playing field somewhat. TJ13 has learned this is another of the threats alongside the budget engine in the FIA’s armoury.

Further, the WMC council may have one eye on the impending EU inquiry into the governance of Formula One, though the inclusion in this decision making ‘mandate’ of Bernie Ecclestone as CEO of the commercial rights holder means that Formula One is still in breach of an Article 82 ruling made previously by the EU Commission. This prevented any party with a commercial interest in Formula One from regulating the sport.

This move by the FIA and the WMC may surprise the teams and PU manufacturers, given that following the recent F1 commission meeting the FIA issued a statement implying an ‘informal’ agreement had been reached by all parties on how to progress the matter of cost control and power unit costs. That statement read;

“The parties involved have agreed on a course to address several key areas relating to Power Unit supply in Formula One. These areas are:

– Guarantee of the supply of Power Units to teams– The need to lower the cost of Power Units to customer teams– Simplification of the technical specification of the power units– Improved noise

“The manufacturers, in conjunction with the FIA, will present a proposal by 15 January 2016 that will seek to provide solutions to the above concerns.

“The proposal will include the establishment of a minimum number of teams that a manufacturer must supply, ensuring that all teams will have access to a Power Unit.

“Measures will also be put forward to reduce the cost of the supply of hybrid Power Units for customer teams, as well as improving their noise.

“All stakeholders agreed that the developments will aim for the 2017 season at the earliest, and 2018 at the latest”.

Given that the constituents of the WMSC are predominantly FIA appointments, todays ruling is an attempt by the FIA to reassert its authority to regulate the sport of Formula One. This FIA declaration gives teeth to the threats made by Todt to the F1 PU manufacturers of the consequence of ‘all parties’ failing to agree a way forward on the above agenda.

whatever this means i hope the things will be decided and forced more effecivelly – as less sitters in Parliment, as smoother the things are flowing through 🙂 P.S.off topic. Mr Judge, there are the time for the polls this time of the season, i.e. best team. best driver etc. Obviously all others will be les or more academic. Can You maybe introduce one for most exiting team & driver i.e. the most interesting/entertaining/watchable/enjoyable/exiting ?

Once again it’s all about cutting costs. Not a word about cutting profits. Not a word about giving the teams and circuits enough money to survive.
Mercedes have made massive advances in engine design in the last couple of years. They may decide that there is no reason to continue to race in F1 for them to make further improvements to their engines. There are several Mercedes board members who don’t see the point in F1, they may feel further agrieved when they watch the coverage of the races and notice how little airtime their team receives.